Last week (on 21 June 2011), Dutch Parliament passed a bill which transposes the amendments to the ePrivacy Directive. Pursuant to the new “cookie law”, incorporated in the Dutch Telecommunications Act (article 11.7a under 1), website operators will be required to obtain prior consent from users before they can store or gain access to cookies on the user’s computer (opt-in). Furthermore, the use of cookies for behavioral advertising is presumed to be a processing of personal data within the meaning of the Dutch Data Protection Act (“DDPA”) (article 11.7a under 1, last sentence).

By introducing the requirement of priorconsent and the assumption of processing personal data when cookies are used for certain purposes, Dutch law goes further than what the ePrivacy Directive required Member States to do. As expected, this new law has stirred and will stir up quite a lot of controversy in the Netherlands and abroad.

Prior informed consent

The new “cookie law” is part of a larger bill amending the Dutch Telecommunications Act (“DTA”), thereby implementing the changes to the European ePrivacy Directive. Article 11.7a under 1 DTA only permits online entities to store information or to gain access to information stored in the terminal equipment of a user (e.g. storing or accessing cookies) where (i) the user is provided with clear and complete information in accordance with the DDPA, and in any event about the purposes for which the information is stored and accessed; and (ii) the user consents to such an act. The word consent in this article refers to the definition of consent in Article 1.1 (i) DDPA and should therefore be a freely-given, specific and well informed consent. According to the explanation provided to the bill, the common practice where web browsers automatically accept all cookies under its standard settings cannot be considered as a form of consent within the meaning of this new article. The explanation provided to the bill also explicitly states that such consent should be obtained prior to the storage of and access to cookies.

Presumption of processing personal data: “unambiguous” consent?

The first sentence of article 11.7a under 1 DTA leaves no doubt that the DDPA will apply to the storage of and access to cookies if this entails a processing of personal data (“Notwithstanding the DDPA…”). According to the last sentence of article 11.7a under 1 DTA, the act of storing and accessing usage information via cookies is presumed to be subject to the DDPA if the collecting, combining or analysis of such usage data concerns the user’s or subscriber’s use of information society services and is conducted for commercial, charity or non-commercial reasons. This element in the new law seems to specifically target cookies that are used for behavioral advertising. Such cookie usage is simply assumed to be a processing of personal data. Furthermore, the legislator seems to imply in the explanatory text that the processing of personal data as set out above should be based on “unambiguous” consent. Interestingly, the DDPA contains several other legal grounds upon which personal data may be processed. For instance, processing of personal data may be allowed in order to uphold the legitimate interest of the data controller being the party processing the data (Article 8 (f) DDPA).

Back to the past or to the future?

The new law appears to undermine the current widespread practice of the so-called opt-out regime whereby cookies are stored and accessed without obtaining prior consent from users. The Dutch legislator has clearly chosen for an opt-in approach. Time will tell whether this law will lead to an “online exodus” to other countries that have a more lenient approach towards the implementation of the ePrivacy Directive or to new practical ways to obtain the user’s informed (unambiguous) consent before placing and accessing cookies. There is a possibility, though, that the new law will only be a spur to the adoption of new technologies to monitor user behavior, for instance through a browser’s “fingerprint”, that will make the use of cookies obsolete.